Metal, banking stocks lead market rally as US delays reciprocal tariffs 

Stock markets surged on Friday, with benchmark indices posting robust gains following the US decision to pause reciprocal tariffs on most countries for 90 days. The BSE Sensex closed at 75,157.26, jumping 1,310.11 points or 1.77 per cent, while the NSE Nifty 50 climbed 429.40 points or 1.92 per cent to finish at 22,828.55, nearly erasing the week’s earlier losses.

Metal stocks emerged as the day’s star performers, with the Nifty Metal index surging 4 per cent. Hindalco Industries led the gainers with a 6.70 per cent jump to ₹601.80, followed by JSW Steel and Tata Steel, which rose 4.99 per cent and 4.95 per cent, respectively. Coal India gained 4.60 per cent, while Jio Financial Services advanced 4.29 per cent.

“An unexpected pause on reciprocal tariffs by the US provided relief in the midst of the uncertainty,” said Vinod Nair, Head of Research at Geojit Investments Limited. “Any development in the bilateral trade negotiations can alter the near-term outlook on the export-driven sectors.”

The broader market also participated in the rally, with the Nifty Midcap 100 index rising 1.85 per cent to 50,501.50 and the Smallcap 100 index gaining 2.80 per cent. Market breadth was overwhelmingly positive, with 3,115 stocks advancing against 846 declining on the BSE, resulting in an advance-decline ratio of 3.68, its highest since March 5.

All sectoral indices ended in the green, with Metal, Consumer Durables, Pharma, and Oil & Gas registering substantial gains. The market’s fear gauge, India VIX, declined sharply by 6.17 per cent to 20.11, indicating easing investor anxiety.

Among the day’s few losers were Asian Paints, which fell 0.75 per cent to ₹2,393, Apollo Hospitals, down 0.53 per cent to ₹6,798, and TCS, which dropped marginally by 0.26 per cent to ₹3,238.

The rupee strengthened significantly against the US dollar, gaining 65 paise to close at 86.04. “Rupee traded positive with strong gains of ₹0.70 at 86.00, supported primarily by a weaker dollar index and a significant sentiment boost from the US decision to relax tariffs on Indian goods by 10 per cent for the next 90 days,” said Jateen Trivedi, VP Research Analyst at LKP Securities.

Dilip Parmar, Senior Research Analyst at HDFC Securities, added: “The US government’s decision of pausing reciprocal tariff for 90 days and tit-for-tat approach between US-China weighed on the greenback. In the near-term, spot USDINR has support at 85.40 and resistance at 86.90.”

The market rebound came despite escalating tensions between the US and China, with the Chinese finance ministry announcing it would increase tariffs on US goods to 125 per cent from 84 per cent, effective April 12.

From a technical perspective, Rupak De, Senior Technical Analyst at LKP Securities, noted: “The Nifty faced resistance around the 21-EMA on the daily timeframe, leading to a close off the day’s high. The trend appears bearish unless it decisively moves above 23,000, where significant open interest has been added.”

Nagaraj Shetti, Senior Technical Research Analyst at HDFC Securities, offered a more optimistic view: “A sustainable move above 22,900-23,000 levels could open the upside target of 23,400-23,500 levels in quick period of time. Immediate support is placed at 22,700 levels.”

Despite Friday’s strong performance, the Nifty ended the week marginally lower by 0.34 per cent. Foreign Portfolio Investors (FPIs) have remained net sellers in April, with outflows totalling ₹32,122.76 crore month-to-date, according to Shrikant Chouhan, Head of Equity Research at Kotak Securities.

Looking ahead, market participants will closely monitor global developments, particularly US-China trade tensions, as well as the ongoing Q4FY25 earnings season, which has shown mixed results so far.

“We expect the index to consolidate in the range of 23,050-22,250 in the coming truncated week. During this consolidation phase, volatility is expected to remain elevated amid tariff-related developments and the progress of the Q4 earnings season,” noted Bajaj Broking Research in its market commentary.

Published on April 11, 2025